Xunlei to acquire sports media firm Hupu for RMB500 million

SHENZHEN - Xunlei Limited (NASDAQ:XNET), a prominent cloud services provider in China, has announced a definitive agreement to purchase Shanghai Kuanghui Internet Technology Co., Ltd., the operator of Hupu, for RMB500 million. Hupu is recognized as China’s leading sports media and data platform. The completion of this acquisition, expected in the first half of 2025, is contingent on certain conditions.

Chairman and CEO of Xunlei, Mr. Jinbo Li, commented that the acquisition of Hupu is anticipated to generate significant synergy with Xunlei's existing services. This strategic move aims to capitalize on Xunlei’s broad user base and advanced technological capabilities in internet content transmission. By integrating with Hupu’s high-quality sports content and dynamic community, the company expects to enhance content downloads, community interaction, and sports consumption in a market characterized by high user loyalty.

The acquisition is also set to bolster Xunlei’s community operations, enriching its content ecosystem with Hupu's premium sports content and engaged user community. Furthermore, it is expected to improve the overall user experience by leveraging Xunlei’s technological and brand strengths.

Established in 2003, Xunlei Limited offers an array of products and services, including cloud acceleration, shared cloud computing, and digital entertainment, aiming to provide an efficient, smart, and secure internet experience.

The forward-looking statements in this announcement reflect the company's plans and expectations and are subject to risks and uncertainties that could cause actual results to differ materially. These include the company's ability to innovate and retain its user base, keep pace with technological advancements, convert users to premium service subscribers, and effectively manage copyright infringement claims and governmental scrutiny of internet content in China.

Investors are cautioned that these statements are not guarantees of future performance and actual results may vary. Xunlei does not undertake any obligation to update forward-looking statements as per the U.S. Private Securities Litigation Reform Act of 1995. The information is based on a press release statement, and further details regarding risks can be found in the company's filings with the U.S. Securities and Exchange Commission. For a deeper understanding of Xunlei's financial position, InvestingPro subscribers can access comprehensive analysis, including 13+ ProTips and a detailed Pro Research Report, which provides expert insights into the company's fundamentals, including its strong current ratio of 2.92 and minimal debt levels.

In other recent news, Xunlei Limited has reported mixed Q3 results, with total revenues reaching $80.1 million, marking a 4.9% year-over-year decline. Despite this, the company's subscription business saw a 15.6% growth, contributing $33.2 million to the total revenue. Furthermore, Xunlei's gross profit margin improved to 50.5%, up from 44.6% in the previous year.

The company also initiated a $20 million share buyback program, repurchasing 588,025 ADS by the end of Q3. On another note, Xunlei has appointed JPMorgan Chase (NYSE:JPM) Bank, N.A. as the new depositary for its American Depositary Receipt (ADR) program, a move that further aligns Xunlei with J.P. Morgan's global services.

Looking ahead, Xunlei projects Q4 revenues to range between $77 million and $82 million, potentially marking a slight decrease from Q3. These recent developments underscore the company's focus on user base growth and market strategies to enhance shareholder value.

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